Candidates bear down on Bush's economic policies

Dan Balz, Washington Post

Published
4:00 am PDT, Tuesday, July 8, 2003

2003-07-08 04:00:00 PDT Manchester, N.H. -- It was "the economy, stupid" again here Monday as a pair of Democratic presidential candidates challenged President Bush's economic stewardship, but the two parted company over a crucial issue that has divided corporate accountability reformers and the technology industry.

Sen. Joe Lieberman, D-Conn., said Bush's economic record amounted to "a national crisis" that was "getting worse every day," and Bush's "one-note" policy of cutting taxes had failed. "It hasn't grown jobs, it hasn't grown the economy," he said. "It's only grown the national debt."

Sen. John Edwards, D-N.C., accused the administration of tolerating "bad conduct in corporate America" and favoring the wealthy with tax cuts while jeopardizing the economic security of middle-class Americans. He said Bush's policies fostered division and inequity that had put a drag on economic confidence. "More than anything else, what's holding our economy down is the callous view of a few at the top in Washington and in the corporate world that the values that got us here can now be left behind," Edwards said.

He outlined steps designed to require reforms in accounting and other areas,

which he said would protect investors and help put executives and workers on a more even footing. The most controversial proposal called for the expensing of stock options, which Edwards said would give stockholders and investors a clearer picture of the financial health of all companies. The idea is opposed by the high-tech industry that Democrats have assiduously courted in recent years.

Edwards is the only Democratic presidential candidate to break with Silicon Valley on the issue. He said deceitful executives had awarded themselves millions of shares of their company's stock and then manipulated balance sheets to inflate stock prices for their personal gain.

The Silicon Valley lobby, with help from many Democrats, blocked last year a bid in Congress to require companies to expense their stock options. Technology company executives say such a move would damage their industry because stock options are crucial in helping recruit innovative workers for the newly emerging companies that offer the options instead of big salaries. Tech companies often offer stock options to up to 80 percent of their workers, while most other companies provide them only to top executives.

Lieberman, who recently won the endorsement of several top Silicon Valley executives, opposes expensing stock options, as does Rep. Dick Gephardt, D-Mo.